FINANCIAL HOLDING COMPANIES ACT

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FINANCIAL HOLDING COMPANIES ACT — 법갈피

Article 7(Restriction on control relationship between financial institutions and financial holding companies) #

(1) No financial holding company shall be in a control relationship prescribed by Presidential Decree (hereafter referred to as "control relationship" in this Article) with any financial institution (including any financial institution incorporated in accordance with foreign statutes); provided, this shall not apply to cases falling under any of the following and meeting the requirements determined by Presidential Decree: <Amended on Aug. 3, 2007; Feb. 29, 2008; Jul. 31, 2009; Jul. 24, 2015; Apr. 20, 2021>

1. Where the financial holding company is in a control relationship with another financial holding company;

2. Where the financial holding company is in a control relationship with an investment company, a private equity fund available only to institutional investors or a special purpose company;

3. Where the financial holding company is in a control relationship with a person authorized by the Financial Services Commission as a foreign financial institution prescribed by Presidential Decree (referring to a person carrying on financial business in a foreign country, which is incorporated in accordance with foreign statutes) in light of the capacity, scale, and soundness of its business management.

(2) Notwithstanding the main clause of paragraph (1), where a financial institution is in a control relationship with a financial holding company due to unavoidable causes prescribed by Presidential Decree, such as exercise of security rights, it shall withdraw from a control relationship with the financial holding company within a period determined by Presidential Decree; provided, where unavoidable reasons exist, such period may be extended with the approval from the Financial Services Commission by up to one year. <Added on Aug. 3, 2007; Feb. 29, 2008; Jul. 31, 2009>

(3) In the case of paragraph (1) 1, another financial holding company and its subsidiary, etc. in a control relationship with a financial holding company shall not be deemed the subsidiary, etc. of the relevant financial holding company in the application of Articles 19 and 19-2. <Added on Jul. 31, 2009>

[This Article Wholly Amended on Apr. 27, 2002]

Article 8(Restriction on ownership of stocks of bank holding companies) #

(1) No same person may hold stocks of a bank holding company in excess of 10/100 of stocks which have been issued by the bank holding company and carry voting rights; provided, this shall not apply to any of the following cases, paragraph (3) of this Article, and Article 8-2 (3):

1. Where the Government or the Korea Deposit Insurance Corporation under the Depositor Protection Act holds stocks issued by the bank holding company;

2. Where it holds stocks issued by the bank holding company controlled by a financial holding company;

3. Where it holds less than 15/100 of all voting stocks of a local bank holding company.

(2) When the same person (excluding those prescribed by Presidential Decree) falls under any of the following, the person shall report to the Financial Services Commission matters prescribed by Presidential Decree as necessary for the confirmation of changes in stock holding or stock holding ratio of a bank holding company: <Amended on Feb. 29, 2008; Jul. 31, 2009; Jul. 24, 2015; Apr. 20, 2021>

1. When he or she holds stocks in excess of 4/100 of all outstanding stocks with voting rights in the bank holding company (excluding a local bank holding company; hereafter the same shall apply in this paragraph);

2. When the same person who falls under subparagraph 1 becomes the largest stockholder of the bank holding company concerned;

3. When the stock holding ratio of the same person who falls under subparagraph 1 changes in excess of 1/100 of all outstanding stocks with voting rights in the bank holding company concerned;

4. In cases of a private equity fund available only to institutional investors holding in excess of 4/100 of all outstanding stocks with voting rights in the bank holding company, when changes in its partners occur;

5. In cases of a special purpose company holding in excess of 4/100 of all outstanding stocks with voting rights in the bank holding company, when changes in its stockholders or partners occur (including when changes in partners of a private equity fund available only to institutional investors which are stockholders or partners of the relevant special purpose company occur).

(3) Notwithstanding the main clause, with the exception of the subparagraphs, of paragraph (1) whenever the same person exceeds the respective limits classified in the following, he or she may hold stocks of a bank holding company with the approval from the Financial Services Commission; provided, the Financial Services Commission may designate and approve, only when it is deemed necessary in consideration of the possibility of contribution to the efficiency and soundness of the banking business, stock distribution among stockholders of the bank holding company concerned, etc., other specific holding limits besides the limits stipulated in the following, and where the same person intends to hold stocks in excess of the approved limit, he or she shall obtain the approval separately from the Financial Services Commission: <Amended on Feb. 29, 2008>

1. Limit stipulated in the main clause, with the exception of the subparagraphs, of paragraph (1) (in cases of a local bank holding company, the limit stipulated in paragraph (1) 3);

2. 25/100 of all outstanding stocks with voting rights in the bank holding company concerned.

3. 33/100 of all outstanding stocks with voting rights in the bank holding company concerned.

(4) Where the Financial Services Commission does not grant the approval under paragraph (3), it shall specify the grounds and inform the applicant thereof within a period prescribed by Presidential Decree. <Amended on Feb. 29, 2008>

(5) Procedures, methods, and detailed criteria for a report and other necessary matters in the application of paragraph (2), as well as the qualifications of persons eligible to hold stocks of a bank holding company, requirements and procedures for the approval related to holding stocks and other necessary matters in the application of paragraph (3), shall be prescribe by Presidential Decree, taking into account the risk of undermining the soundness of the relevant bank holding company, etc., the appropriateness of the scale of assets and financial status, the level of credit extended by the relevant bank holding company, etc., the possibility to contribute to the efficiency and the soundness of the financial industry, etc. <Amended on Jul. 31, 2009>

(6) Where an investment company holds stocks of a bank holding company with the approval under paragraph (3), Article 81 (1) 1 (a) through (c) under the Financial Investment Services and Capital Markets Act shall not apply to the relevant investment company and the asset management company which is a corporate director of the investment company. <Amended on Aug. 3, 2007; Jul. 31, 2009>

[This Article Wholly Amended on Apr. 27, 2002]

Article 8-2(Restriction on ownership of stocks of non-financial investors) #

(1) Notwithstanding Article 8 (1), no non-financial investor (including persons excluded from an enterprise group, etc. subject to the limitation on mutual investment under Article 32 of the Monopoly Regulation and Fair Trade Act and consequently ceasing to constitute a non-financial investor, for whom the period prescribed by Presidential Decree has not passed from the date of such exclusion; hereafter the same may apply in paragraph (2)) may hold stocks of a bank holding company in excess of 4/100 (in cases of a local bank holding company, 15/100) of all outstanding stocks with voting rights of the bank holding company. <Amended on Jul. 31, 2009; Aug. 13, 2013; Dec. 29, 2020>

(2) Notwithstanding paragraph (1), where a non-financial investor has obtained the approval from the Financial Services Commission by satisfying the requirements, including financial soundness, etc., prescribed by Presidential Decree on condition that it shall not exercise voting rights for the stocks in a bank holding company that it intends to hold in excess of the limit of paragraph (1) (excluding cases of a local bank holding company), it may hold stocks up to the limit stipulated in the main clause, with the exception of the subparagraphs, of Article 8 (1). <Amended on Feb. 29, 2008>

(3) Notwithstanding paragraphs (1) and (2) of this Article, the main clause, with the exception of the subparagraphs, of Article 8 (1) and paragraph (3) of the same Article shall apply to any of the following non-financial investors: <Amended on Jul. 31, 2009; Aug. 13, 2013>

1. A non-financial investor who has obtained the approval after filing with the Financial Services Commission a plan for being converted into a person who is not a non-financial investor (hereinafter referred to as "conversion plan") within two years;

2. A non-financial investor who has obtained the approval from the Financial Services Commission with respect to holding stocks of a bank holding company by meeting all the following requirements, as a fund under Article 5 of the National Finance Act or a corporation managing and operating such fund (including corporations entrusted with the management and operation of funds in accordance with Acts: hereafter referred to as "funds, etc." in this subparagraph):

(a) The non-financial investor shall be equipped with systems prescribed by Presidential Decree in order to prevent conflicts of interest among the funds which hold stocks of a bank holding company and interested parties of a bank holding company, etc., such as other stockholders and depositors;

(b) The non-financial investors shall receive supervision and inspection from the institutions prescribed and publicly notified by the Financial Services Commission in order to prevent conflicts of interest under item (a) within the necessary scope;

(c) Other requirements prescribed by Presidential Decree, taking into account the impact which stock holding of funds, etc. might have on the soundness of a bank holding company, etc.

(4) The requirements for the approval for a conversion plan under paragraph (3) 1, methods and procedures for the approval under subparagraph 2 of the same paragraph and other matters necessary for a review of the approval shall be prescribed by Presidential Decree. <Amended on Jul. 31, 2009>

[This Article Added on Apr. 27, 2002]

Article 8-3(Appraisal and inspections of conversion plans) #

(1) A non-financial investor who intends to apply for the approval under Article 8-2 (3) 1 shall submit a conversion plan to the Financial Services Commission, and if deemed necessary for the appraisal of the conversion plan by a specialized organization, the Financial Services Commission may conduct such appraisal, as prescribed by the Financial Services Commission. <Amended on Feb. 29, 2008; Jul. 31, 2009>

(2) The Financial Services Commission shall regularly inspect the status of compliance with the conversion plan of a non-financial investor who holds stocks of a bank holding company in excess of the limit under Article 8-2 (1) with the approval on the conversion plan under paragraph (3) 1 of the same Article (hereinafter referred to as "person subject to conversion"), as prescribed by Presidential Decree, and then make such results available to the public by means of computer communications networks, etc. <Amended on Feb. 29, 2008; Jul. 31, 2009>

(3) Where a person subject to conversion is not acknowledged to be executing the conversion plan after an inspection pursuant to of paragraph (2), the Financial Services Commission may order him or her to execute it, setting a period not exceeding six months. <Amended on Feb. 29, 2008>

(4) No person subject to conversion falling under any of the following may exercise voting rights over the stocks of a bank holding company, which are held in excess of the limit stipulated in Article 8-2 (1): <Amended on Feb. 29, 2008; Jul. 31, 2009>

1. A person subject to conversion who has received an order of execution from the Financial Services Commission pursuant to paragraph (3);

2. A person subject to conversion who has been ascertained to have been involved in any illegal transactions with a bank holding company, etc. after an inspection by the Governor of the Financial Supervisory Service (referring to the Financial Supervisory Service under the Act on the Establishment, etc. of the Financial Services Commission; hereinafter the same shall apply) due to the grounds under Article 51-2 (1) 1 (b).

(5) Where a person subject to conversion falls under any of the following, the Financial Services Commission may set a period of up to six months and order him or her to dispose of any surplus stocks of a bank holding company held in excess of the limit stipulated in Article 8-2 (1): <Amended on Feb. 29, 2008>

1. Where he or she fails to comply with an order of execution pursuant to the of paragraph (3);

2. Where he or she falls under paragraph (4) 2.

[This Article Added on Apr. 27, 2002]

Article 8-5(Approval on stock holdings by private equity funds available only to institutional investors) #

(1) Deleted. <Aug. 13, 2013>

(2) Where a private equity fund available only to institutional investors or special purpose company (hereinafter referred to as "private equity fund available only to institutional investors, etc.") intends to obtain the approval under Article 8 (3), it shall meet all the following requirements: <Amended on Aug. 13, 2013; Jul. 24, 2015; Apr. 20, 2021>

1. The following requirements with respect to a managing general partner of a private equity fund available only to institutional investors:

(a) The managing general partner shall not be a specially related person of other partners or stockholders of a private equity fund available only to institutional investors, etc. in which the managing general partner is a managing general partner as a corporation or the management of property of which is entrusted by him or her;

(b) The managing general partner shall have capacity to manage properties, experience and social standing to the extent that can exclude the exercise of the influence over stocks or equities which are the property of the relevant private equity fund available only to institutional investors, etc. by other partners or stockholders of a private equity fund available only to institutional investors, etc. in which the managing general partner him or herself is a managing general partner or the management of property of which is entrusted by him or her;

2. Other requirements prescribed by Presidential Decree, taking into account the influence of the stock holdings by a private equity fund available only to institutional investors, etc. over the soundness of the relevant bank holding company.

(3) In reviewing the approval under Article 8 (3), the Financial Services Commission may, if necessary for verification as to whether the requirements under paragraph (2) are satisfied, request the relevant private equity fund available only to institutional investors, etc. or the managing general partner in charge of the management of property thereof to furnish information or data prescribed by Presidential Decree, such as the articles of incorporation of the relevant private equity fund available only to institutional investors, etc., and other details of contracts concluded between the stockholders or partners. <Amended on Aug. 13, 2013; Jul. 24, 2015; Apr. 20, 2021>

(4) Where the Financial Services Commission decides not to grant approval under Article 8 (3), it shall notify the applicant thereof, specifying the reasons therefor, within the period prescribed by Presidential Decree. <Amended on Aug. 13, 2013>

(5) Deleted. <Aug. 13, 2013>

(6) The Financial Services Commission may, when granting the approval under Article 8 (3), attach necessary conditions in connection with participation in the management, etc. when the relevant private equity fund available only to institutional investors, etc. is likely to exercise de facto influence over the major management issues of a bank holding company, etc. taking into account of detailed composition, etc. of members or shareholders of the relevant private equity funds available only to institutional investors. <Amended on Aug. 13, 2013; Jul. 24, 2015; Apr. 20, 2021>

(7) Procedures and review methods for the approval under Article 8 (3), detailed standards of requirements under paragraph (2) and other necessary matters shall be prescribed by Presidential Decree. <Amended on Aug. 13, 2013>

[This Article Added on Jul. 31, 2009]

[Title Amended on Jul. 24, 2015; Apr. 20, 2021]

Article 10(Restriction on voting rights of stocks held in excess of limit) #

(1) Any person who holds stocks of a bank holding company in excess of the stock holding limit under Article 8 (1) and (3) or 8-2 (1) and (2) shall not exercise voting rights in relation to the stocks held in excess of the limit under Article 8 (1), (3) or 8-2 (1) or (2) and shall, without delay, comply with the limit. <Amended on Apr. 27, 2002; Jul. 31, 2009; Aug. 13, 2013>

(2) Notwithstanding paragraph (1), where contingent capital securities convertible into stocks of a bank holding company issued under Article 15-2 (1) 3 are converted into stocks of a bank holding company, or contingent bonds convertible into stocks of a bank holding company issued under Article 33 (1) 4 of the Banking Act are converted into stocks of an unlisted bank under that subparagraph and simultaneously the converted stocks are exchanged with stocks of a listed bank holding company under that subparagraph, or contingent bonds convertible into stocks of a financial holding company issued under Article 114-2 (1) 3 of the Insurance Business Act are converted into stocks of an unlisted stock insurance company under that subparagraph and simultaneously the converted stocks are exchanged with stocks of a listed financial holding company under that subparagraph, any of the following persons shall be subject to the classification of the respective subparagraphs: <Added on Mar. 29, 2016; Apr. 18, 2017; Dec. 31, 2022>

1. In the case of a person who holds stocks of a bank holding company in excess of the stock holding limit under Article 8 (1) and (3): He or she shall complete all the following procedures and shall not, before completing the procedures, exercise his or her voting right in relation to the stocks held in excess of the aforementioned limit:

(a) He or she shall report his or her ownership of the stocks of a bank holding company in excess of the stock holding limit under Article 8 (1) and (3) to the Financial Services Commission within the period prescribed by Presidential Decree;

(b) He or she shall complete either of the following measures within the period prescribed by Presidential Decree; provided, where there exists any unavoidable ground, the period may be extended up to six months after obtaining approval therefor by the Financial Services Commission:

(i) Measures requiring the approval by the Financial Services Commission pursuant to Article 8 (3);

(ii) Measures ensuring that the limit pursuant to Article 8 (1) and (3) is not exceeded;

2. In the case of a person who holds stocks of a bank holding company in excess of the stock holding limit under Article 8-2 (1) (excluding the case of a local bank holding company) and within the stock holding limit under Article 8-2 (2): He or she shall complete all the following procedures and shall not exercise his or her voting right with respect to his or her stocks held in excess of the aforementioned limit:

(a) He or she shall report his or her ownership of the stocks of a bank holding company in excess of the stock holding limit under Article 8-2 (1) to the Financial Services Commission within the period prescribed by Presidential Decree;

(i) Measures requiring the approval by the Financial Services Commission pursuant to Article 8-2 (2);

(ii) Measures ensuring that the limit pursuant to Article 8-2 (1) is not exceeded;

3. In the case of a person who holds stocks of a bank holding company in excess of the stock holding limit under Article 8-2 (1) (limited to the case of a local bank holding company) or the stock holding limit under Article 8-2 (2): He or she shall not exercise his or her voting right with respect to his or her stocks held in excess of the aforementioned limit and shall without delay take measures to meet the limit.

(3) The Financial Services Commission may order a person who fails to comply with the provisions of paragraph (1) or (2) to dispose of the stocks exceeding the limit, within a prescribed period of up to six months. <Amended on Feb. 29, 2008; Jul. 31, 2009; Aug. 13, 2013; Mar. 29, 2016>

(4) The procedures, methods, etc. for reporting pursuant to paragraph (2) 1 (a) and 2 (a) shall be determined and publicly notified by the Financial Services Commission. <Added on Mar. 29, 2016>

Article 10-2(Deliberation on eligibility of stockholders holding stocks in excess of limit) #

(1) The Financial Services Commission shall deliberate, as prescribed by Presidential Decree, whether a person who holds stocks of a bank holding company pursuant to Articles 8 (3) and 8-2 (3) (hereafter referred to as "stockholders, etc. holding stocks in excess of limit" in this Article) continues to meet the requirements for eligibility and approval under Articles 8 (5) and 8-5 (2), respectively, (hereafter referred to as "requirements for excess holdings" in this Article) even after the person holds the relevant stocks. <Amended on Feb. 29, 2008; Jul. 31, 2009; Aug. 13, 2013>

(2) If deemed necessary for deliberation under paragraph (1), the Financial Services Commission may request data or information with respect to a bank holding company or stockholders, etc. holding stocks in excess of limit. <Amended on Feb. 29, 2008; Jul. 31, 2009>

(3) When the Financial Services Commission recognizes that stockholders, etc. holding stocks in excess of limit fail to meet the requirements, etc. for excess holdings after deliberation under paragraph (1), it may issue an order to meet the requirements for excess holdings within a period of up to six months. <Amended on Feb. 29, 2008; Jul. 31, 2009>

(4) No stockholder, etc. holding stocks in excess of limit who has been ordered pursuant to paragraph (3) may exercise voting rights to the stocks of a bank holding company held in excess of the limit under the following classifications until he or she complies with the relevant order: <Amended on Jul. 31, 2009; Aug. 13, 2013>

1. The same person obtaining the approval under Article 8 (3): The limit under Article 8 (3) 1;

2. A non-financial investor falling under any subparagraph of Article 8-2 (3): The limit under Article 8-2 (1);

3. Deleted. <Aug. 13, 2013>

(5) Where a stockholder, etc. holding stocks in excess of limit who has been ordered pursuant to paragraph (3) fails to comply with the relevant order, the Financial Services Commission may issue an order to dispose of the stocks of the bank holding company held in excess of the limit under the classification under each subparagraph of paragraph (4) within a period of up to six months. <Amended on Feb. 29, 2008; Jul. 31, 2009; Aug. 13, 2013>

(6) The Financial Services Commission shall, when deliberating on whether the requirements, etc. for excess holdings under paragraph (1), deliberate on whether a person falling under Article 8-2 (3) 2 meets the requirements under each item of the same subparagraph. <Added on Jul. 31, 2009>

[This Article Added on Apr. 27, 2002]

Article 15-2(Issuance of bank debenture) #

(1) A bank holding company may issue the bonds falling under each of the following subparagraphs (hereinafter referred to as "bank debenture"):

1. Corporate bonds as prescribed under the Commercial Act;

2. A bond bearing a condition that its debtor’s duty to repay the principle and interest be partly or entirely exempted upon occurrence of the events preliminarily agreed (hereinafter referred to as "preliminarily agreed event"), as at the time of issuance of the bond, in accordance with objective and reasonable standards (hereinafter referred to as "contingent redeemable bond"), among the bonds as prescribed in Article 165-11 (1) of the Financial Investment Services and Capital Markets Act;

3. A bond bearing a condition that the bond be converted to the stocks of a bank holding company upon occurrence of the preliminarily agreed events, as at the time of issuance of the bond (hereinafter referred to as "contingent convertible bond"), among the bonds as prescribed in Article 165-11 (1) of the Financial Investment Services and Capital Markets Act;

4. Other bonds equivalent to the bonds under subparagraphs 1 through 3, as prescribed by Presidential Decree.

(2) Matters necessary concerning the condition and method, etc. of issuance of the bank debenture shall be prescribed by Presidential Decree.

(3) Where a bank holding company has issued the bank debenture (limited to the contingent redeemable bond and the contingent convertible bond; hereafter the same shall apply in this paragraph) without obtaining the resolution of its board of directors meeting or general meeting of shareholders under Article 165-11 (2) of the Financial Investment Services and Capital Markets Act to be applied mutatis mutandis pursuant to Article 15-3, the Financial Services Commission may order the bank holding company not to issue a bank debenture for a certain period of time determined by the Financial Services Commission.

[This Article Added on Apr. 18, 2017]

Article 19(Second-tier and third-tier subsidiaries) #

(1) No subsidiary of a financial holding company shall control companies other than the following companies; provided, with respect to a company that controls other companies as at the time the former becomes a subsidiary, this shall not apply for two years from the date on which the former becomes a subsidiary:

1. A financial institution prescribed by Presidential Decree as related in business to the subsidiary concerned;

2. A company prescribed by Presidential Decree as closely related to running financial business.

(2) No second-tier subsidiary of a financial holding company shall control any other company; provided, this shall not apply to any of the following cases: <Amended on Jul. 31, 2009>

1. Where a second-tier subsidiary controls a financial institution established in a foreign country or a company closely related to carrying on financial business;

2. Where a second-tier subsidiary has controlled any other company as at the time of incorporation as a second-tier subsidiary, and two years have not passed since the incorporation;

3. Where a non-affiliated company that holds stocks has become an affiliate to be controlled by a second-tier subsidiary, and one year has not passed since the company becomes an affiliate.

(3) No third-tier subsidiary of a financial holding company shall control any other company; provided, this shall not apply to any of the following: <Added on Jul. 31, 2009>

1. Where a third-tier subsidiary has controlled any other company as at the time of incorporation as a third-tier subsidiary, and two years have not passed since the incorporation;

2. Where a non-affiliated company that holds stocks has become an affiliate to be controlled by a third-tier subsidiary, and one year has not passed since the company becomes an affiliate.

(4) Paragraph (3) shall apply mutatis mutandis where a subsidiary, etc. included as a part of a financial holding company controls any other company by vertically investing in even lower tier companies than those under paragraph (3). <Added on Jul. 31, 2009>

Article 22(Special cases concerning submitters of conversion plan to non-bank holding company) #

(1) Where a person who exercises control over the business of a company belonging to an enterprise group subject to the limitation on mutual investment designated pursuant to Article 31 (1) of the Monopoly Regulation and Fair Trade Act or his or her specially related person submits to the Financial Services Commission a plan to convert into a non-bank holding company (hereafter referred to as "conversion plan" in this Article) and then obtain approval therefor, the companies expected to be a non-bank holding company and subsidiary, etc. under the conversion plan (hereafter referred to as "companies subject to conversion" in this Article) shall be deemed a financial holding company and its subsidiary, etc. under this Act until the execution of such conversion plan from the date of approval. <Amended on Dec. 29, 2020>

(2) Notwithstanding paragraph (1), even if any legal relationship is created as at the time a company subject to conversion obtains approval from the Financial Services Commission under paragraph (1), unlike the details of any of the following provisions (hereafter referred to as "regulations on restricted acts" in this Article), the regulations on restricted acts shall not apply to the relevant company subject to conversion within a period acknowledged at the time the Financial Services Commission grants approval, within five years from the date of approval; provided, the Financial Services Commission may extend a grace period for regulations on restricted acts by up to two years where it is impracticable for a company subject to conversion to acquire and dispose of stocks or to sell assets due to changes in economic conditions, such as rapid decrease in stock prices, substantial losses in business or any other reason:

1. Article 5-2 (2);

2. Article 6-3;

3. Article 7;

4. Article 15;

5. Article 19;

6. Deleted; <May 28, 2014>

7. Deleted; <May 28, 2014>

8. Article 43-2;

9. Article 43-3;

10. Article 44;

11. Article 48 (1) 2;

12. Article 48 (5).

(3) When granting approval for a conversion plan under Article (1), the Financial Services Commission may attach conditions to exclude the application of the following details, taking into account the risk of undermining the soundness of financial institutions: <Amended on Jul. 31, 2015>

1. Deleted; <Jul. 31, 2015>

2. Entrustment of business between subsidiaries, etc. under Article 47 (1);

3. Joint advertisements and common use of facilities, such as computer communications networks under Article 48 (4);

4. Furnishing of information under Article 48-2 (1) through (3);

5. Concurrent office-holding by executive officers and employees under Article 10 of the Act on Corporate Governance of Financial Companies.

(4) When granting approval under paragraph (1) or extending the period under the proviso of paragraph (2), the Financial Services Commission shall consult the Fair Trade Commission in advance with respect to whether competition is practically restricted in the relevant market and whether any provision of the Monopoly Regulation and Fair Trade Act is violated.

(5) If deemed necessary for the evaluation of a conversion plan by a specialized organization, the Financial Services Commission may conduct such evaluation, as prescribed and publicly notified by the Financial Services Commission.

(6) The Financial Services Commission shall regularly inspect the status of execution of a conversion plan of a company subject to conversion, as prescribed by Presidential Decree, and then make such results available to the public on its website, etc.

(7) Where it is deemed, after an inspection under paragraph (6), that a company subject to conversion fails to execute the conversion plan, the Financial Services Commission may exclude the application of each subparagraph of paragraph (3) or issue an order of execution, setting a period of up to six months.

(8) None of the following companies subject to conversion may exercise voting rights to stocks held contrary to the regulations on restricted acts (excluding Articles 43-2 and 43-3):

1. A company subject to conversion who has been ordered by the Financial Services Commission under paragraph (7);

2. A company subject to conversion where illegal transactions between a financial holding company and its subsidiary, etc. or between subsidiaries, etc. belonging to the same financial holding company are confirmed after an inspection by the Governor of the Financial Supervisory Service (hereinafter referred to as the "Governor").

(9) Where a company subject to conversion falls under any of the following cases, the Financial Services Commission may order such company subject to conversion to dispose of stocks held against the regulations on restricted acts, setting a period of up to six months:

1. Where the company subject to conversion fails to execute the order under paragraph (7);

2. Where he or she falls under paragraph (8) 2.

(10) Matters necessary for approval under paragraph (1), the extension of period under the proviso of paragraph (2), the standards, methods and procedures for the order of execution under paragraph (7) and the order for disposition under paragraph (9) shall be prescribed by Presidential Decree.

[This Article Added on Jul. 31, 2009]

Article 34(Restriction on trading with large stockholders) #

(1) No non-bank holding company and its subsidiary, etc. (hereinafter referred to as "non-bank holding company, etc.") shall extend credit to directly or indirectly support investment in another company by a large stockholder (including his or her specially related persons; hereafter the same shall apply in this Article) of the relevant non-bank holding company, except for cases where it is necessary for the exercise of rights, such as execution of security rights, or other cases prescribed by Presidential Decree for the purpose of effectively carrying on financial business to the extent not undermining the soundness of non-bank holding companies, etc.

(2) The aggregate of the credit extended to a large stockholder of a non-bank holding company by the non-bank holding company, etc. (excluding financial holding companies controlled by another non-bank holding company; hereafter the same shall apply in this paragraph and paragraphs (3) through (7) of this Article) shall not exceed the standards prescribed by Presidential Decree, taking into account business types of the non-bank holding company, etc.; provided, this shall not apply to cases falling under the causes referred to in the proviso of Article 45 (1).

(3) No non-bank holding company, etc. shall acquire (including acquisition through trust business) stocks (including investment equities) issued by a large stockholder of the non-bank holding company in excess of the standards prescribed by Presidential Decree, taking into account business types of the relevant non-bank holding company, etc. In such cases, the Financial Services Commission may set acquisition limits for each type of stock within the acquisition limit under the former part.

(4) Where a non-bank holding company, etc. exceed the limit under paragraph (3) as a person who is not a large stockholder of a non-bank holding company becomes a new large stockholder, such non-bank holding company, etc. shall dispose of the stocks held in excess of the limit within a period prescribed by Presidential Decree.

(5) Where a non-bank holding company, etc. intend to extend credit to a large stockholder of a non-bank holding company above the standards prescribed by Presidential Decree or to acquire bonds or stocks issued by a large stockholder of the relevant non-bank holding company above the standards prescribed by Presidential Decree, the non-bank holding company, etc. shall refer the issue to the board of directors in advance for resolution. In such cases, the resolution of the board of directors shall be adopted with the unanimous consent of all directors.

(6) Where a non-bank holding company, etc. conduct any of the following acts with a large stockholder of the relevant non-bank holding company, the non-bank holding company, etc. shall report thereon to the Financial Services Commission without delay and then make it available to the public on their website, etc.:

1. Extension of credit above the standards prescribed by Presidential Decree;

2. Acquisition of bonds or stocks issued by a large stockholder of the relevant non-bank holding company above the standards prescribed by Presidential Decree;

3. Exercise of voting rights to the stocks issued by a large stockholder of the relevant non-bank holding company.

(7) With respect to credit extension to a large stockholder of the relevant non-bank holding company or the acquisition of bonds or stocks issued by a large stockholder of the relevant non-bank holding company, a non-bank holding company, etc. shall report thereon to the Financial Services Commission in a quarterly basis, as prescribed by Presidential Decree and then make it available to the public on their website, etc.

(8) Where an insurance company which is a subsidiary, etc. of a non-bank holding company intends to engage in a transaction with a large stockholder of the relevant non-bank holding company as prescribed by Presidential Decree, such insurance company shall report thereon to the Financial Services Commission 30 days prior to the date of transaction.

(9) No large stockholder of a non-bank holding company shall perform any of the following acts for the interests of an individual large stockholder, contrary to the interests of the relevant non-bank holding company, etc.: <Amended on Jul. 31, 2015>

1. Requesting the provision of data or information which has not been disclosed with respect to the relevant non-bank holding company, etc. in order to exercise unfair influence; provided, the exercise of rights under Article 33 (6) of the Act on Corporate Governance of Financial Companies and Article 466 of the Commercial Act shall be excluded herefrom;

2. Exercising of unfair influence over the personnel affairs or management of the relevant non-bank holding company, etc. in collusion with other stockholders in exchange of the provision of considerations, like economic benefits;

3. Other acts prescribed by Presidential Decree as equivalent to those under subparagraphs 1 and 2.

(10) The Financial Services Commission may take any of the following measures with regard to a non-bank holding company, etc. in cases prescribed by Presidential Decree as likely to undermine the soundness of the management of such non-bank holding company, etc. due to poor financial structure, such as cases where the liabilities of a large stockholder (limited to a company) of the non-bank holding company exceed the assets, or the ability to repay debts significantly weakens:

1. Prohibition from new extension of credit to a large stockholder;

2. Prohibition from new acquisition of securities issued by a large stockholder (referring to securities under the Financial Investment Services and Capital Markets Act; hereinafter the same shall apply);

3. Other measures prescribed by Presidential Decree, such as trading restriction on financial support to a large stockholder.

(11) If the Financial Services Commission recognizes that a non-bank holding company, etc. or a large stockholder of a non-bank holding company is suspected of violating the provisions of paragraphs (1) through (10), it may request the relevant non-bank holding company, etc. or large stockholder to submit necessary data.

[This Article Added on Jul. 31, 2009]

Article 43-2(Obligation to own stocks of subsidiaries) #

(1) Except as otherwise provided in this Act, a financial holding company shall own at least 50/100 [if the subsidiary is a stock listed corporation (referring to a stock listed corporation under the Financial Investment Services and Capital Markets Act; hereinafter the same shall apply), or if the subsidiary is a corporation which makes it impracticable for any change in equities among investors because at least two investors who own considerable equities that may have an impact on the management by significantly restricting transfer of equities through a contract or any other manner similar thereto (hereafter referred to as "joint stock corporation" in this Article), 30/100; hereafter referred to as "standard for stock ownership" in this Article] of all outstanding stocks issued by the relevant subsidiary; provided, this shall not apply where a financial holding company fails to meet the standards for stock ownership due to any of the following causes: <Amended on Feb. 3, 2009; Jul. 31, 2009; Jun. 8, 2010; Apr. 18, 2017>

1. Where a financial holding company owns stocks of its subsidiary less than the standards for stock ownership as at the time it became subject to the requirements for financial holding companies and two years have not passed since the date when it became subject to the requirements for financial holding companies;

2. Where a subsidiary which used to be a stock listed corporation fails to meet the standards for stock ownership and one year has not passed since the date it failed to meet such standards;

3. Where a subsidiary fails to meet the standards for stock ownership through the preferential allotment of stocks to employee stock ownership association under Article 38 of the Framework Act on Labor Welfare when offering or selling stocks, a request for conversion of convertible bonds or bonds with warrants issued under Article 513 or 516-2 of the Commercial Act, or the exercise of preemptive rights to new stocks, and one year has not passed since the date when it failed to meet the standards for stock ownership;

4. Where a company which was not a subsidiary has become a subsidiary, thus failing to meet the standards for stock ownership, but one year has not passed since the date when it became the subsidiary;

5. Where a subsidiary fails to meet the standards for stock ownership in the course of becoming a non-subsidiary, and one year has not passed since the date it failed to meet such standards (limited to cases where the subsidiary becomes a non-subsidiary within one year from the date it fails to meet the standards for stock ownership).

(2) In applying the standards for stock ownership, a subsidiary that has issued and listed or registered stocks overseas may be deemed a stock listed corporation, if the Financial Services Commission approves it upon considering stability, mobility and clarity of such overseas market and the level of publicity and self-regulation system of the stock exchange in such foreign country. <Amended on Feb. 29, 2008>

(3) Where a financial holding company substantially proves its de facto control prescribed by Presidential Decree, over its subsidy that is a foreign corporation (hereafter referred to as "foreign subsidy" in this paragraph), the Financial Services Commission may lower the standard for stock ownership on stocks owned by the foreign subsidy concerned in spite of the standard for stock ownership referred to in paragraph (1). In such cases, despite paragraph (1), such financial holding company shall own stocks of its foreign subsidy in excess of the standard of stock ownership set by the Financial Services Commission. <Amended on Feb. 29, 2008>

(4) Matters necessary for detailed standards for jointly invested corporations under paragraph (1), securities market in a foreign country under paragraph (2) and the relaxation of the standards for stock ownership under paragraph (3) shall be prescribed by Presidential Decree. <Amended on Jul. 31, 2009>

[This Article Added on Aug. 3, 2007]

Article 45(Limit on extension of credit) #

(1) The total amount of credit extended by a financial holding company (excluding any financial holding company controlled by another financial holding company; hereafter the same shall apply in this Article) and its subsidiary, etc. (hereafter referred to as "financial holding company, etc." in this Article) to the same borrower (referring to the same borrower under Article 35 (1) of the Banking Act) shall not exceed 25/100 of the net total amount of the equity capital of the financial holding company, etc.; provided, this shall not apply to cases falling under any of the following, as prescribed by Presidential Decree:

1. Where it is necessary for the national economy and for securing the effectiveness of credit extended by the financial holding company, etc.;

2. Where the limit described in the main clause is exceeded due to a change in the equity capital and the same borrower, etc., although the financial holding company, etc. do not extend any additional credit.

(2) The total amount of credit extended by the financial holding company, etc. to the same individual or the same corporation shall not exceed 20/100 of the net total amount of its equity capital; provided, this shall not apply to cases falling under the causes referred to in the proviso of paragraph (1). <Amended on Apr. 27, 2002>

(3) The total amount of credit extended by a financial holding company, etc. to the same person who holds stocks in excess of 10/100 of all voting stocks issued by that financial holding company shall not exceed an amount computed according to the method prescribed by Presidential Decree within the limit of 25/100 of the net total amount of the equity capital of such financial holding company, etc.; provided, this shall not apply to cases falling under the causes referred to in the proviso of paragraph (1). <Amended on Apr. 27, 2002>

(4) Where a financial holding company, etc. whose total amount of credit exceeds the limit specified in the main clause of paragraph (1) other than each subparagraph, the main clause of paragraph (2) or the main clause of paragraph (3) due to the cause under paragraph (1) 2, such credit shall be consistent with the limit prescribed by Presidential Decree, within one year from the date such limit is exceeded; provided, in cases of unavoidable causes prescribed by Presidential Decree, the Financial Services Commission may extend the period by prescribing a further period. <Amended on Feb. 29, 2008; Jul. 31, 2009>

(5) The scope of a subsidiary, etc., standards for extending credit and the method of computing equity capital and the net total amount of such equity capital referred to in paragraphs (1) through (4) shall be determined by Presidential Decree.

Article 45-2(Limit on extension of credit for major investors of bank holding company) #

(1) The total amount of credit which a bank holding company, etc. (excluding a financial holding company controlled by another bank holding company; hereafter the same shall apply in this Article and Articles 45-3 through 45-5) can extend to the major investors (including persons specially related thereto; hereinafter the same shall apply) of the bank holding company, shall not exceed the lesser of the amount equivalent to the value of a percentage prescribed by Presidential Decree, which is within the extent of 25/100 of the net total amount of its equity capital, and the amount equivalent to the value of the investment proportion of such major investors of the bank holding company concerned; provided, this shall not apply where the bank holding company, etc. fall under the causes referred to in the proviso of Article 45 (1). <Amended on Aug. 3, 2007>

(2) The total amount of credit that a bank holding company, etc. can extend to all major investors of the bank holding company concerned shall not exceed the amount equivalent to the value of a percentage prescribed by Presidential Decree, which is within the extent of 25/100 of the net total amount of its equity capital. <Amended on Aug. 3, 2007>

(3) No bank holding company, etc. shall cross-extend credit with other bank holding companies, etc. or banks for the purpose of evasion of the credit grant limit pursuant to paragraphs (1) and (2).

(4) When a bank holding company, etc. intend to extend credit (including a transaction prescribed by Presidential Decree; hereafter the same shall apply in this Article) to the major investors of the bank holding company concerned in excess of the amount prescribed by Presidential Decree, they shall be subject to a prior resolution by the board of directors. In such cases, the board of directors shall pass a resolution by a unanimous vote of all directors on the register. <Amended on Aug. 3, 2007>

(5) When a bank holding company, etc. extend credit to the major investors of the bank holding company concerned in excess of the amount prescribed by Presidential Decree, they shall, without delay, report such fact to the Financial Services Commission and announce it by means of computer communications networks, etc. <Amended on Aug. 3, 2007; Feb. 29, 2008>

(6) A bank holding company, etc. shall announce matters regarding the credit grants to the major investors of the bank holding company concerned, on a quarterly basis by means of computer communications networks, etc., as prescribed by Presidential Decree. <Amended on Aug. 3, 2007>

(7) The scope of subsidiaries, etc., standards for credit grants, methods of calculating equity capital and the net total amount of equity capital pursuant to paragraphs (1) through (6) shall be prescribed by Presidential Decree.

(8) No bank holding company, etc. shall extend credit for subsidizing investment in another company by major investors of the relevant bank holding company. <Added on Jul. 31, 2009>

(9) No bank holding company, etc. shall transfer assets to major investors of the relevant bank holding company without consideration, trade or exchange such assets, or extend credit, to the relevant bank holding company under significantly unfair conditions in light of common trading conditions. <Added on Jul. 31, 2009>

[This Article Added on Apr. 27, 2002]

Article 45-3(Limit on acquisition of stocks issued by major investors) #

(1) No bank holding company, etc. shall acquire (including acquisition by trust business operation; hereafter the same shall apply in this Article) stocks (including investment equities; hereafter the same shall apply in this Article) issued by the major investors of the bank holding company in excess of the amount equivalent to the value of a percentage prescribed by Presidential Decree, within the extent of 1/100 of the net total amount of their equity capital. In such cases, the Financial Services Commission may separately determine the limit on stock acquisition by kind within the limit on acquisition under the former part of this paragraph. <Amended on Aug. 3, 2007; Feb. 29, 2008>

(2) Where persons who have not been major investors of a bank holding company become major investors and consequently a bank holding company, etc. thereby exceed the limit pursuant to the provisions of paragraph (1), such bank holding company, etc. shall dispose of the surplus stocks within a period prescribed by Presidential Decree. <Amended on Aug. 3, 2007>

(3) When a bank holding company, etc. intends to acquire stocks issued by the major investors of the bank holding company concerned in excess of the amount prescribed by Presidential Decree, it shall be subject to a prior resolution by the board of directors. In such cases, the board of directors shall pass a resolution by unanimous vote of all directors on the register. <Amended on Aug. 3, 2007>

(4) When a bank holding company, etc. acquire stocks issued by the major investors of the bank holding company concerned in excess of the amount prescribed by Presidential Decree, it shall, without delay, report such fact to the Financial Services Commission and announce it by means of computer communications networks, etc. <Amended on Aug. 3, 2007; Feb. 29, 2008>

(5) A bank holding company, etc. shall announce matters regarding the acquisition of the stocks issued by the major investors of the bank holding company concerned, on a quarterly basis by means of computer communications networks, etc., as prescribed by Presidential Decree. <Amended on Aug. 3, 2007>

(6) In exercising voting rights to the stocks issued by major investors of a bank holding company, etc., the bank holding company, etc. shall exercise such rights in a way that does not contravene the terms of resolution that can be carried by the number of stocks obtained by subtracting the number of stocks held by the bank holding company concerned, etc. from the number of stocks of the major investors attending the general meeting of stockholders; provided, this shall not apply where it is evidently expected that loss to the bank holding company concerned, etc. will occur by such means as merger of the major investors, transfer and takeover of business operations, selection and appointment of executive officers, and other means equivalent thereto. <Amended on Aug. 3, 2007>

[This Article Added on Apr. 27, 2002]

Article 47(Entrustment of business affairs between subsidiaries) #

(1) A subsidiary, etc. of a financial holding company may entrust another subsidiary, etc. with part of the business affairs engaged in by the subsidiary, etc. with respect to financial business or business affairs closely related to the operation of financial business; provided, it shall not entrust the business affairs prescribed by Presidential Decree as likely to spread risk to other subsidiaries, etc. cause conflicts of interest among customers, or undermine sound trade order.

(2) A financial holding company shall, when any business affair is entrusted between its subsidiaries, etc. pursuant to the main clause of paragraph (1), obtain prior approval from the Financial Services Commission by meeting the standards prescribed by Presidential Decree, such as the appropriateness of internal control guidelines under Article 24 of the Act on Corporate Governance of Financial Companies; provided, in cases prescribed by Presidential Decree as unlikely to spread risk to other subsidiaries, etc. cause conflicts of interest among customers, or undermine the soundness of a financial company, the financial holding company shall report the following matters to the Financial Services Commission following the methods and procedures prescribed by Presidential Decree: <Amended on Jul. 31, 2015>

1. The scope of business affairs entrusted;

2. Matters on the restricted acts of trustees;

3. Matters on record-keeping on the handling of business affairs entrusted;

4. Others prescribed by Presidential Decree as necessary to prevent the spread of risk to other subsidiaries, etc. prevent conflicts of interest among customers, or maintain sound trade order.

(3) Where any details of a report under the proviso of paragraph (2) fall under any of the following, the Financial Services Commission may restrict the entrustment of the relevant business affairs or issue corrective orders:

1. Where the details undermine the soundness of the management of financial institutions;

2. Where the details cause conflicts of interest with customers;

3. Where the details undermine the stability of the financial market;

4. Where the details disrupt the order of financial transactions.

(4) Where the business affairs entrusted under the main clause of paragraph (1) is principal business affairs (referring to the business affairs prescribed by Presidential Decree as essential business affairs closely related to the business affairs for which the relevant financial institution or a company closely related to the operation of financial business has obtained authorization or registration; hereafter the same shall apply in this paragraph), a subsidiary, etc. entrusted with such principal business affairs shall be a person who has obtained authorization or registration necessary to conduct such business affairs. In such cases, if the subsidiary, etc. entrusted with the business affairs is a foreign subsidiary, etc. and satisfies the requirements prescribed by Presidential Decree, the subsidiary, etc. shall be deemed to have obtained authorization or registration necessary to conduct the business affairs.

(5) Article 756 of the Civil Act shall apply mutatis mutandis where a subsidiary, etc. entrusted with the business affairs under paragraph (1) causes any loss to a customer in the course of conducting business affairs entrusted. In such cases, the financial holding company and the subsidiary, etc. which entrusts the business affairs shall be jointly liable to compensate such loss.

(6) Matters necessary for the standards, methods and procedures for entrustment of business affairs under the main clause of paragraph (1), the scope of subsidiaries, etc. subject to the approval and report under paragraph (2) and the methods and procedures for the approval and report shall be prescribed by Presidential Decree.

[This Article Added on Jul. 31, 2009]

Article 48(Restrictions on conduct by subsidiaries) #

(1) No subsidiary, etc. of a financial holding company shall engage in the following acts; provided, this shall not apply to cases where the subsidiary, etc. is newly included in the financial holding company or other cases prescribed by Presidential Decree: <Amended on Jul. 31, 2009>

1. Extension of credit for a financial holding company to which the relevant subsidiary, etc. belongs;

2. Holding stocks issued by other subsidiary, etc. of the financial holding company to which the relevant subsidiary, etc. belongs, except for any of the following cases:

(a) Holding stocks of a company directly controlled by the relevant subsidiary, etc.;

(b) Holding stocks of a foreign corporation controlled by other subsidiary, etc. within the scope which does not exceed the standards prescribed by Presidential Decree in order to prevent the spread of risk;

3. Extension of credit to other subsidiary, etc. of the financial holding company to which the relevant subsidiary, etc. belongs, which exceeds the standards prescribed by Presidential Decree.

(2) Where subsidiaries, etc. belonging to the same financial holding company extend credit to each other, such subsidiaries, etc. shall secure appropriate securities according to the standards prescribed by Presidential Decree; provided, this shall not apply where such subsidiaries, etc. extend credit to each other for their corporate restructuring in a manner that meets the requirements prescribed by the Financial Services Commission. <Amended on Feb. 29, 2008>

(3) A bank, insurance company, or any other subsidiary, etc. prescribed by Presidential Decree, which are financial institutions equivalent thereto shall neither purchase dishonored assets prescribed by Presidential Decree from a financial holding company to which the subsidiary, etc. belong and from their subsidiary, etc. (hereinafter referred to as "financial holding company, etc."), nor trade the relevant dishonored assets under significantly unfair conditions compared with common trading conditions, such as trading with any other person as a party in trading dishonored assets between a financial holding company and its subsidiary, etc. or between subsidiaries, etc.; provided, this shall not apply to cases meeting the requirements prescribed by the Financial Services Commission, such as transactions necessary for the restructuring of a subsidiary, etc. <Amended on Jul. 31, 2009>

(4) A financial holding company, etc. may, notwithstanding other statutes, advertise jointly, or jointly use a computer system, office space, branches, or other facilities prescribed by Presidential Decree. In such cases, the financial holding company, etc. shall meet the standards prescribed by Presidential Decree. <Amended on Jul. 31, 2009>

(5) No subsidiary, etc. of a financial holding company shall own stocks issued by such financial holding company; provided, this shall not apply where a subsidiary, etc. of such financial holding company acquires stocks issued by such financial holding company under Article 62-2 (1) of this Act or Article 342-2 of the Commercial Act. <Amended on Apr. 27, 2002>

(6) Deleted. <Apr. 27, 2002>

(7) Where a subsidiary, etc. of a financial holding company owns stocks of such financial holding company or another subsidiary, etc. of such financial holding company, it shall not exercise voting rights to such stocks; provided, this shall not apply to cases falling under any of the items of paragraph (1) 2. <Amended on Aug. 3, 2007; Jul. 31, 2009>

(8) The scope of subsidiaries, etc. and standards for extending credit under paragraphs (1) 1 and 3 and (2) shall be determined by Presidential Decree.

Article 48-2(Provision and management of customer information) #

(1) Notwithstanding Article 4 (1) of the Act on Real Name Financial Transactions and Confidentiality and Articles 32 and 33 of the Credit Information Use and Protection Act, a financial holding company, etc. may provide information or data on financial transactions under Article 4 of the Act on Real Name Financial Transactions and Confidentiality (hereinafter referred to as "financial transaction information") and personal credit information under Article 32 (1) of the Credit Information Use and Protection Act regarding the following matters to the financial holding company, etc. to which they belong in order for them to use such information for the internal business management prescribed by Presidential Decree, such as credit risk management, according to methods and procedures prescribed by the Financial Services Commission (hereinafter referred to as "procedures for providing customer information"): <Amended on Jul. 31, 2009; May 28, 2014; Mar. 11, 2015>

1. Scope of information that it may provide;

2. Methods of processing, such as the encoding of customer information;

3. Separate keeping of customer information;

4. Period of use and purposes of use of customer information;

5. Deletion of customer information when the period of use expires;

6. Other matters prescribed by Presidential Decree for the stringent management of customer information.

(2) Any investment trader or broker under the Financial Investment Services and Capital Markets Act which is a subsidiary, etc. of a financial holding company may provide any of the following information (hereinafter referred to as "information, on the total amount of securities, etc."), from among information on money or securities deposited by a depositor who trades, or intends to trade, securities through the relevant investment trader or investment broker, to the financial holding company, etc. to which the investment trader or broker belongs in order for them to use such information for the internal business management prescribed by Presidential Decree, such as credit risk management, according to procedures for providing customer information: <Amended on Jul. 31, 2009; May 28, 2014>

1. The total amount of money deposited;

2. The total amount of securities deposited;

3. The total amount of securities deposited for each type;

4. Other information prescribed and publicly notified by the Financial Services Commission as equivalent to those under subparagraphs 1 through 3.

(3) Where a subsidiary, etc. provide financial transaction information, personal credit information, and information on the total amount of securities, etc. (hereinafter referred to as "customer information") pursuant to paragraphs (1) and (2), Article 32 (10) of the Credit Information Use and Protection Act shall not apply. <Amended on Jul. 31, 2009; Mar. 11, 2015>

(4) Where a subsidiary, etc. provide a financial holding company, etc. to which they belong with customer information pursuant to paragraphs (1) and (2), they shall notify their customers of the details of information they has provided; provided, where they have not collected personal information they may notify, such as contact details, this shall not apply. <Added on May 28, 2014>

(5) Kinds of information a subsidiary, etc. should notify pursuant to paragraph (4), a cycle and method of notification, and other necessary matters shall be prescribed by Presidential Decree. <Added on May 28, 2014>

(6) A financial holding company, etc. shall appoint at least one person from among their executive officers to take charge of the management of customer information (hereinafter referred to as "customer information officer") in order to strictly manage customer information. <Amended on Jul. 31, 2009; May 28, 2014>

(7) Each customer information officer shall prepare a business guidebook, as prescribed by the Financial Services Commission, for the strict management of customer information and then report the details thereof to the Financial Services Commission. <Amended on Feb. 29, 2008; Jul. 31, 2009; May 28, 2014>

(8) A financial holding company, etc. shall formulate a policy for handling customer information, as prescribed by Presidential Decree, and shall notify their counterparty of such policy or shall make a public announcement of the policy and post it at their business office. <Amended on Jul. 31, 2009; May 28, 2014>

(9) Detailed scope of a financial holding company, etc. and their subsidiary, etc. subject to the provisions of paragraphs (1) through (8) shall be prescribed by Presidential Decree. <Added on Jul. 31, 2009; May 28, 2014>

[This Article Added on Apr. 27, 2002]

Article 51-2(Inspections of major investors) #

(1) Where a person falling under any of the following (hereafter referred to as "major investor, etc." in this Act) falls under any of the items under the corresponding subparagraphs, the Financial Services Commission may have the Governor conduct an inspection of the business and financial status of the relevant major investor, etc. within the minimum scope necessary for the purpose of such inspection: <Amended on Feb. 29, 2008; Jul. 31, 2009; Aug. 13, 2013>

1. For a company subject to conversion: Cases falling under any of the following:

(a) Where it is necessary to confirm the results of an inspection under Article 8-3 (2);

(b) Where it is deemed that a company subject to conversion is likely to make illegal transactions with a bank holding company, etc. due to the deterioration of its financial status, such as rapid increase in borrowings and the occurrence of substantial losses;

2. For a non-financial investor who obtains the approval under Article 8-2 (3) 2: Cases falling under any of the following:

(a) Where it is necessary to confirm whether the requirements under Article 8-2 (3) 2 (a) and (c) are satisfied;

(b) Where it is deemed that the relevant non-financial investor is likely to make illegal transactions with a bank holding company, etc. due to the deterioration of its financial status, such as rapid increase in borrowings of a non-financial company controlled by the relevant non-financial investor;

3. For a major investor of a bank holding company and a person who intends to become such major investor: Cases falling under any of the following:

(a) Where it is necessary to review the approval under Articles 8 (3);

(b) Where it is deemed to have violated Article 45-4;

(2) Detailed scope, method and other matters necessary for inspections pursuant to paragraph (1) shall be prescribed by the Financial Services Commission. <Amended on Feb. 29, 2008>

(3) Article 51 (2) through (4) shall apply mutatis mutandis to inspections under paragraph (1).

[This Article Added on Apr. 27, 2002]

Article 57(Administrative dispositions) #

(1) Where it is deemed that a financial holding company, etc. (including its executive officers and employees) is likely to undermine soundness of their management in violation of this Act or any orders issued thereunder or where it falls under any of the subparagraphs of the Appendix of the Act on Corporate Governance of Financial Companies (limited to the measures falling under subparagraph 5), the Financial Services Commission may take any of the following measures. The same shall also apply where a financial holding company (including its executive officers and employees; hereafter the same shall apply in this paragraph) causes a subsidiary, etc. to violate the finance-related statutes prescribed by Presidential Decree or orders issued thereunder by using its power of control over such subsidiary, etc.: <Amended on Apr. 27, 2002; Feb. 29, 2008; Mar. 14, 2008; Jul. 31, 2009; Jul. 31, 2015; Apr. 18, 2017>

1. Cautions or warnings to the financial holding company, etc. or demand to caution, warn or reprimand the relevant executive officers and employees;

2. Orders to correct the violation in question;

3. Deleted; <Apr. 27, 2002>

4. Recommendation to dismiss the relevant executive officers (excluding the chief operation officer under subparagraph 5 of Article 2 of the Act on Corporate Governance of Financial Companies; hereafter the same shall apply in this subparagraph, Article 57-2 and 57-3) or suspend their duties or appointment of agents to act on behalf of them;

4-2. Request for resignation of the relevant employees (including the chief operation officer under subparagraph 5 of Article 2 of the Act on Corporate Governance of Financial Companies; hereafter the same shall apply in Article 57-2 and 57-3);

5. Suspension of part of the business of its subsidiary, etc. which has committed the violation for up to six months.

(2) Where any financial holding company, etc. fall under any of the following, the Financial Services Commission may order such financial holding company, etc. to suspend all of their business for a period not exceeding six months or to dispose of stocks of their subsidiary, etc. or may revoke the authorization granted to such financial holding company, etc.: <Amended on Apr. 27, 2002; Feb. 29, 2008; Jul. 31, 2015>

1. Where it has obtained authorization under Article 3 in a fraudulent or other unlawful manner;

2. Where it has failed to execute an order issued to correct a violation under paragraph (1) 2;

3. Where it runs its business during a business-suspension period under paragraph (1) 5;

4. Where, in addition to subparagraphs 1 through 3, it is feared to greatly undermine any interest of depositors or investors of its subsidiary, etc. by violating this Act or orders issued or dispositions taken under this Act;

5. Where it ceases to fall under Article 2 (1) 1 due to a decrease in stock holdings, increase or decrease in assets, etc. during the business year concerned;

6. Where it falls under any of the subparagraphs of the Appendix of the Act on Corporate Governance of Financial Companies (limited to cases of issuing an order to suspend entire business).

(3) Where the authorization of a financial holding company is revoked under paragraph (2), it shall cease to be subject to the requirements of a financial holding company within three months. <Added on Aug. 3, 2007>

Article 57-3(Sanction against private equity funds available only to institutional investors) #

(1) Where a private equity fund available only to institutional investors, etc. (referring only to a private equity fund available only to institutional investors, etc. which holds stocks of a bank holding company with the approval under Article 8 (3); hereafter the same shall apply in this paragraph through paragraph (4)) or any stockholder or partner thereof violates Article 8-7, the relevant private equity fund available only to institutional investors, etc. shall not exercise voting rights to the stocks held in excess and then without delay dispose of the excess portion of stocks. <Amended on Aug. 13, 2013; Jul. 24, 2015; Apr. 20, 2021>

(2) If a private equity fund available only to institutional investors, etc. fails to comply with paragraph (1), the Financial Services Commission may order the private equity fund available only to institutional investors, etc. to dispose of stocks held in excess, for a specified period not more than one month. <Amended on Jul. 24, 2015; Apr. 20, 2021>

(3) The Financial Services Commission may, when a private equity fund available only to institutional investors, etc. falls under any of the subparagraphs of Article 8-7, take any of the following measures: <Amended on Jul. 24, 2015; Apr. 20, 2021>

1. Issuing an order to correct or suspend the relevant act;

2. Orders to publish or post a statement that measures have been taken due to the act in question;

3. Issuing an institutional warning;

4. Issuing an institutional caution;

5. Other measures prescribed by Presidential Decree, as necessary for correcting or preventing the relevant act.

(4) The Financial Services Commission may, when a managing general partner in charge of the management, etc. of property of a private equity fund available only to institutional investors, etc. falls under any of the subparagraphs of Article 8-7, take measures under the following classification: <Amended on Jul. 24, 2015; Apr. 20, 2021>

1. Any of the following measures with respect to the managing general partner:

(a) A request for dismissal;

(b) Suspension from office for up to six months;

(d) An institutional caution;

(e) Other measures prescribed by Presidential Decree, as necessary for correcting or preventing the relevant act;

2. Any of the following measures with respect to an executive officer of the managing general partner:

(a) A request for dismissal;

(b) Suspension from office for up to six months;

(d) A cautionary warning;

(e) Other measures prescribed by Presidential Decree, as necessary for correcting or preventing the relevant act;

3. Demand to take any of the following measures with respect to an employee of the managing general partner:

(a) Dismissal;

(b) Suspension from office for up to six months;

(d) Reprimand;

(e) Caution;

(f) Other measures prescribed by Presidential Decree as necessary to correct or prevent the act in question.

(5) Paragraphs (2) through (4) shall apply mutatis mutandis to a private equity fund available only to institutional investors, etc. (including its stockholders or partners) falling under any of the following. In such cases, paragraph (4) 2 shall apply mutatis mutandis when the managing general partner is an individual: <Amended on Jul. 24, 2015; Apr. 20, 2021>

1. Where the private equity fund, etc. holds stocks of a bank holding company in excess of the stock-holding limit under Article 8 (1) or (3);

2. Deleted; <Aug. 13, 2013>

3. Where the private equity fund, etc. becomes subject to an order to dispose of stocks under Article 10-2 (5).

(6) Article 10 (3) shall not apply to private equity funds available only to institutional investors, etc. falling under paragraph (5) 1. <Amended on Aug. 13, 2013; Jul. 24, 2015; Mar. 29, 2016; Apr. 20, 2021>

[This Article Added on Jul. 31, 2009]

[Title Amended on Jul. 24, 2015; Apr. 20, 2021]

Article 62-2(Special cases for stock swaps and stock transfers) #

(1) Where a subsidiary acquires stocks of a financial holding company through stock swap or stock transfer, or a second-tier subsidiary acquires stocks of a subsidiary, in the application of Article 342-2 of the Commercial Act with respect to the stocks of the financial holding company or subsidiary allocated as consideration in exchange for any of the following treasury stocks among the relevant stocks, "six months" in paragraph (2) of the same Article shall be deemed "three years": <Amended on Aug. 3, 2007; Jul. 31, 2009; Apr. 5, 2013>

1. Treasury stocks that are acquired through the exercise of the appraisal rights of the stockholders opposing the stock swap or stock transfer;

2. Treasury stocks that are acquired under Article 341 (1) of the Commercial Act or Article 165-3 of the Financial Investment Services and Capital Markets Act, and purchased from the date when the board of directors passes a resolution on the approval for stock swap contract or the approval for stock transfer till the expiry date of the appraisal rights of the stockholders.

(2) In the application of the Commercial Act with respect to a stock swap or stock transfer in order to establish a financial holding company (including cases where a financial holding company, etc. newly include a subsidiary or second-tier subsidiary; hereafter the same shall apply in this Article) or to own all the stocks of the existing subsidiary or second-tier subsidiary, "two weeks" in the main clause of Article 354 (4), Article 360-4 (1) other than each subparagraph, Article 360-5 (2), the main clause of Article 360-9 (2), Article 360-10 (4), provisions, with the exception of the subparagraphs, of Article 360-17 (1), and the main clause of Article 363 (1) of the said Act shall be deemed "seven days", respectively; "20 days" in Article 360-5 (1) and (2) of the said Act shall be deemed "ten days", respectively; "one month prior to" in provisions, with the exception of the subparagraphs, of Article 360-8 (1) of the said Act shall be deemed "five days prior to"; "when the intent to oppose stock swap is notified" in Article 360-10 (5) of the said Act shall be deemed "when the intent to oppose stock swap is notified within seven days from the notice or public announcement under paragraph (4)"; "within a period determined in excess of one month" in Article 360-19 (1) 2 of the said Act shall be deemed "within a period determined for at least five days"; and "within two months" in Article 374-2 (2) of the said Act shall be deemed "within one month". <Amended on Aug. 3, 2007; Jul. 31, 2009>

(3) Where an agreement on the purchase price of stocks is not reached between the stockholders opposing stock swap or stock transfer in order to establish a financial holding company or to own all the stocks of the existing subsidiary or second-tier subsidiary, such purchase price of stocks shall be the amount calculated under the following classification, notwithstanding Article 374-2 (4) and (5) of the Commercial Act applied mutatis mutandis under Article 360-5 (3) of the said Act: <Amended on Aug. 3, 2007; Jul. 31, 2009>

1. Where the relevant company is a stock listed corporation: The amount calculated by a method prescribed by Presidential Decree based on the purchase price of such stocks traded on the securities market prior to the date of resolution on the approval for stock swap contract or stock transfer made by the board of directors;

2. Where the relevant company is a company other than those under subparagraph 1: The amount calculated by an accounting expert. In such cases, the scope of an accounting expert and procedures for appointment shall be prescribed by Presidential Decree.

(4) Where a company swaps or transfers stocks in order to establish a financial holding company or own all the stocks of the existing subsidiary or second-tier subsidiary, or a stockholder holding at least 30/100 of the number of stocks subject to appraisal under Article 360-5 of the Commercial Act opposes the purchase price of stocks, which is calculated under paragraph (3), the relevant company or stockholder may file an application for the adjustment of the purchase price with the Financial Services Commission ten days prior to the date when the purchase shall be completed pursuant to Article 374-2 (2) of the said Act. <Amended on Aug. 3, 2007; Feb. 29, 2008; Jul. 31, 2009>

[This Article Added on Apr. 27, 2002]

Article 64(Penalty surcharges) #

Where any financial holding company or its subsidiary, etc. violates Article 6-3, 6-4, 34, 36, 44, 45, 45-2, 45-3, 48, or 62-2 (1), or any major investor violates Article 45-4, the Financial Services Commission may impose penalty surcharges in accordance with the following classification: <Amended on Apr. 27, 2002; May 31, 2005; Aug. 3, 2007; Feb. 29, 2008; Jul. 31, 2009; Apr. 18, 2017; Apr. 20, 2021>

1. In cases of holding stocks in violation of Article 6-3 or 6-4: The aggregate of the book values of the stocks held in violation marked on the statement of financial position prescribed by Presidential Decree;

1-2. In cases of exceeding the limit on extension of credit under Article 34 (2): Up to the amount of credit extended in excess;

1-3. In cases of exceeding the limit on stock acquisition under Article 34 (3): Up to the aggregate of the book values of the stocks acquired in excess of the limit;

2. In cases of exceeding the stock holding limit under Article 44: Up to 30/100 of the aggregate of the book values of the stocks held in excess of the limit;

3. In cases of exceeding the limit on extension of credit under Articles 36 (1) and 45 (1) through (3): Up to 30/100 of the amount of credit extended in excess of the limit;

4. In cases of exceeding the limit on extension of credit under Article 45-2 (1) and (2): Up to the amount of credit extended in excess of the limit;

4-2. In cases of extending credit, transferring assets without consideration, trading or exchanging assets in violation of Article 45-2 (8) or (9): Up to the amount of credit extended or the book values of the assets;

5. In cases of exceeding the limit on stock acquisition under Article 45-3 (1): Up to the aggregate of the book values of the stocks acquired in excess of the limit;

5-2. Where a major investor violates Article 45-4 whereby a bank holding company, etc. extend credit to the major investor in excess of the limit on extension of credit under Article 45-2 (1) or (2): Up to the amount of credit extended in excess of the limit;

5-3. Where a major investor violates Article 45-4 whereby a bank holding company, etc. extend credit, transfer assets without consideration, or trade or exchange to the major investor in violation of Article 45-2 (8) or (9): Up to the amount of credit extended or the book values of the assets;

5-4. Where a major investor violates Article 45-4 whereby a bank holding company, etc. acquire stocks of the major investor in excess of the stock holding limit under Article 45-3 (1): Up to the aggregate of the book values of the stocks acquired in excess of the limit;

6. Deleted; <Jul. 31, 2009>

7. Where a subsidiary, etc. extend credit to a financial holding company in violation of Article 48 (1) 1: Up to 30/100 of the amount of credit extended;

8. In cases of holding stocks of a subsidiary, etc. in violation of Article 48 (1) 2: Up to 30/100 of the aggregate of the book values of the stocks held;

9. In cases of exceeding the limit on extension of credit between subsidiaries, etc. in violation of Article 48 (1) 3: Up to 30/100 of the amount of credit extended in excess of the limit;

10. In cases of extending credit without securing appropriate collateral in violation of Article 48 (2): Not more than 10/100 of the amount of credit extended;

11. In cases of trading dishonored assets in violation of Article 48 (3): Up to 30/100 of the book values of the assets;

12. In cases of holding stocks in violation of the provisions of Article 48 (5): Up to 5/100 of the aggregate of the book value of the stocks held;

13. Deleted; <Aug. 3, 2007>

14. In cases of holding stocks in violation of Article 62-2 (1): Not more than 5/100 of the aggregate of the book values of the stocks held.

Article 68(Extensions of payment deadline for penalty surcharges and payment by installment) #

(1) The Financial Services Commission may defer the deadline for payment of a penalty surcharge imposed on a (hereinafter referred to as "person liable to pay a penalty surcharge") or allow the person to pay a penalty surcharge in installments pursuant to the proviso of Article 29 of the Framework Act on the Administration, and in such cases, the Financial Services Commission may require the person to provide security, if deemed necessary.

(2) If a person liable to pay a penalty surcharge intends to obtain permission for deferral of the deadline for or payment in installments of the payment of a penalty surcharge under paragraph (1) shall file an application therefor with the Financial Services Commission no later than 10 days before the deadline.

(3) If a person liable to pay a penalty surcharge who has the deadline for payment deferred or is permitted to pay in installments under paragraph (1) falls under any of the following subparagraphs, the Financial Services Commission may revoke the decision to defer the deadline for payment or to permit the payment in installments and may collect the penalty surcharge in a lump sum:

1. If the person liable to pay a penalty surcharge fails to pay the penalty surcharge payable in installments by the deadline for payment;

2. Where he or she fails to comply with a request for the provision of security or commits an act that damages the value of the provided security;

3. If it is found that it is impossible to collect the whole amount or balance of a penalty surcharge due to forced execution, the commencement of an auction, the declaration of bankruptcy, the dissolution of the corporation concerned, or the disposition on the coercive collection of a national tax or delinquency of a local tax;

4. Where it is deemed possible to pay a penalty surcharge in a lump sum because the grounds prescribed in the subparagraphs of Article 29 of the Framework Act on the Administration cease to exist;

5. If any other cause or event equivalent to the causes and events under subparagraphs 1 through 4 has occurred.

(4) Except as provided in paragraphs (1) through (3), matters necessary for deferral of the deadline for a penalty surcharge, payment in installments, provision of security, etc. shall be prescribed by Presidential Decree.

[This Article Wholly Amended on Sep. 14, 2023]

Article 70(Penalty provisions) #

(1) Any of the following persons shall be punished by imprisonment with labor for not more than ten years or by a fine not exceeding 500 million won: <Amended on Jul. 31, 2009>

1. A person who extends credit in violation of Article 34 (1) and (2) and a person who is offered an extension of credit from the former;

2. A person who acquires stocks issued by a large stockholder in violation of Article 34 (3);

3. A person who violates Article 34 (9);

4. A person who extends credit or executes a transfer without consideration, and a person who is provided with extension of credit or transfer without consideration from the former or a party who trades or exchanges assets, in violation of Article 36 (3);

5. A person who extends credit or executes a transfer without consideration, to a major investor, and the major investor who is provided with extension of credit or transfer without consideration from the former or a party who trades or exchanges assets, in violation of Article 45-2 (1) through (3), (8), and (9);

6. A person who acquires stocks issued by a major investor in violation of Article 45-3 (1);

7. A person who violates Article 45-4;

8. A person who violates Article 48-3 (2).

(2) Any of the following persons shall be punished by imprisonment with labor for not more than five years or by a fine not exceeding 200 million won: <Amended on Jul. 31, 2009; May 28, 2014>

1. A person who meets the requirements for financial holding companies, and fails to obtain authorization or be relieved from the requirements for financial holding companies in violation of Article 3, the main clause of Article 5-2 (2), or Article 57 (3);

2. A person who violates Article 48-3 (1);

3. An executive officer or employee of a financial holding company, etc. who provides or divulges customer information acquired in the course of his or her duties to a person other than the relevant financial holding company, etc. or uses customer information for purposes other than business.

(3) Any of the following persons shall be punished by imprisonment with labor for not more than three years or by a fine not exceeding 100 million won: <Amended on Jul. 31, 2009>

1. A person who is in a control relationship with a financial holding company or fails to relinquish such control relationship with a financial holding company, in violation of Article 7 (1) or (2);

2. A person who holds all liabilities, in violation of Article 35;

3. A person who extends credit in excess of the limit on extension of credit, in violation of Article 36 (1);

4. A person who owns stocks of a subsidiary less than the stock holding standards or holding standards relaxed by the Financial Services Commission in violation of Article 43-2 (1) or the latter part of Article 43-2 (3) (including cases applied mutatis mutandis pursuant to Article 43-3);

5. A person who acquires stocks in excess of the limit on stock holding, in violation of Article 44;

6. A person who extends credit in excess of the limit on extension of credit, in violation of Article 45.

(4) Any of the following persons shall be punished by imprisonment with labor for not more than one year or by a fine not exceeding 30 million won: <Amended on Jul. 31, 2009; May 28, 2014; Apr. 18, 2017>

1. A person who violates Article 15;

1-2. A person who has issued a bank debenture in violation of Article 15-2;

2. A person who includes a subsidiary, etc. without obtaining approval, in violation of Article 16;

3. A person who controls any other company in violation of Article 19, or controls any other company that is not designated as a company that may be subject to control under Article 19-2, 25 (1) or (2) (including cases applied mutatis mutandis pursuant to Article 28), 26 (1) or (2) (including cases applied mutatis mutandis pursuant to Article 28), 31, or 32 (1) or (3) (including cases applied mutatis mutandis pursuant to Article 32 (4));

4. A person who performs an act, in violation of Article 6-3 or 6-4;

5. Deleted; <May 28, 2014>

6. A person who entrusts business in violation of the proviso of Article 47 (1);

7. A person who violates Article 48;

8. A person who conducts dissolution or merger without obtaining authorization under Article 60.

(5) A person who includes a subsidiary, etc. without reporting thereon in violation of Article 18 shall be punished by imprisonment with labor for not more than six months or by a fine not exceeding ten million won. <Added on Jul. 31, 2009; May 28, 2014>

[This Article Wholly Amended on Apr. 27, 2002]

Article 72(Administrative fines) #

(1) Any of the following persons shall be subject to an administrative fine not exceeding 100 million won: <Amended on Apr. 27, 2002; Aug. 3, 2007; Feb. 29, 2008; Jul. 31, 2009; Aug. 13, 2013; May 28, 2014; Mar. 29, 2016; Apr. 18, 2017>

1. A person who fails to make a report in violation of Article 5-2 (1), 8 (2), or 8-6 or who fails to report in violation of the main clause of Article 6-2 (1);

1-2. A person who uses words indicating a financial holding company, in violation of Article 5-3;

2. A person who violates an order of the Financial Services Commission under Article 10 (3);

3. A person who fails to comply with a demand to provide data under Article 8-5 (3) (including cases for review of approval under Article 8 (3)), 10-2 (2), 34 (11), or 45-5 (1) or (2);

3-2. Deleted; <May 28, 2014>

3-3. Deleted; <Jul. 31, 2015>

3-4. Deleted; <Jul. 31, 2015>

3-5. Deleted; <Jul. 31, 2015>

3-6. Deleted; <Jul. 31, 2015>

4. A financial holding company, etc. which fail to undergo a resolution by the board of directors, in violation of Article 34 (5), 45-2 (4), or 45-3 (3);

5. A financial holding company, etc. which fail to report to the Financial Services Commission or make a public announcement, in violation of Articles 34 (6) or (7), 45-2 (5) or (6), or 45-3 (4) or (5);

5-2. A person who fails to report, in violation of Article 34 (8);

6. A person who violates the provisions of Article 48-2 (1), (2), (4), or (6) through (8);

7. Deleted; <Apr. 18, 2017>

8. A person who fails to submit or fraudulently prepares his or her work report, in violation of Article 54;

9. A person who fails to make or falsely makes a public announcement, in violation of Article 55;

10. A person who fails to make or fraudulently makes a public notice, in violation of Article 56;

11. A person who refuses, obstructs, or evades an inspection under this Act by concealing books and documents, making unreliable reports, or using other methods;

12. A financial holding company which violates this Act or the regulations, orders, or directions thereunder.

(2) Any of the following persons shall be subject to an administrative fine not exceeding twenty million won: <Amended on Apr. 27, 2002; Jul. 31, 2009; May 28, 2014; Apr. 18, 2017>

1. Deleted; <Jul. 31, 2015>

2. Deleted; <Apr. 18, 2017>

3. Deleted; <Apr. 18, 2017>

4. Deleted; <Apr. 18, 2017>

5. Deleted; <Apr. 18, 2017>

6. An executive officer or employee of a financial holding company, etc. who neglects to keep or furnish documents, make reports, publish, or issue public announcement, which are required by this Act;

7. A person who violates this Act or regulations, orders, or directions thereunder (excluding financial holding companies).

(3) Administrative fines under paragraphs (1) and (2) shall be imposed and collected by the Financial Services Commission, as prescribed by Presidential Decree. <Amended on Feb. 29, 2008>

(4) Deleted. <Jul. 31, 2009>

(5) Deleted. <Jul. 31, 2009>

(6) Deleted. <Jul. 31, 2009>

FINANCIAL HOLDING COMPANIES ACT

Article 1(Purpose) #

Article 2(Definitions) #

Article 3(Authorization) #

Article 4(Standards for authorization) #

Article 5 #

Article 5-2(Obligation to obtain authorization) #

Article 5-3(Prohibition from using trade names) #

Article 6(Public announcement of authorization) #

Article 6-2(Report on modification of capital or articles of incorporation) #

Article 6-3(Restriction on owning stocks of non-financial companies by financial holding companies) #

Article 6-4(Restriction on owning stocks of affiliates by financial holding companies) #

Article 7(Restriction on control relationship between financial institutions and financial holding companies) #

Article 7-2 #

Article 8(Restriction on ownership of stocks of bank holding companies) #

Article 8-2(Restriction on ownership of stocks of non-financial investors) #

Article 8-3(Appraisal and inspections of conversion plans) #

Article 8-4 #

Article 8-5(Approval on stock holdings by private equity funds available only to institutional investors) #

Article 8-6(Matters to be reported by private equity funds available only to institutional investors) #

Article 8-7(Obligations of private equity funds available only to institutional investors) #

Article 9(Special cases concerning foreign banks) #

Article 10(Restriction on voting rights of stocks held in excess of limit) #

Article 10-2(Deliberation on eligibility of stockholders holding stocks in excess of limit) #

Article 11 #

Article 12 #

Article 13(Special cases for bank holding companies) #

Article 14 #

Article 15(Business affairs) #

Article 15-2(Issuance of bank debenture) #

Article 15-3(Procedure for issuance of contingent redeemable bond and contingent convertible bond) #

Article 16(Approval for inclusion of company as subsidiary) #

Article 17(Requirements for approving inclusion of company as subsidiary) #

Article 18(Report on inclusion of company as subsidiary) #

Article 19(Second-tier and third-tier subsidiaries) #

Article 19-2(Control of other companies by second-tier and third-tier subsidiaries which is financial investment business entity) #

Article 20 #

Article 21 #

Article 22(Special cases concerning submitters of conversion plan to non-bank holding company) #

Article 23(Authorization for incorporation) #

Article 24(Approval of inclusion of subsidiaries) #

Article 25(Control over other companies by subsidiaries) #

Article 26(Special cases concerning control over other companies by second-tier subsidiaries) #

Article 27 #

Article 28(Special cases concerning financial holding companies controlling mutual savings banks) #

Article 29(Authorization for incorporation) #

Article 30(Approval of inclusion of subsidiary) #

Article 31(Control over other companies by subsidiaries) #

Article 32(Special cases concerning control over other companies by second-tier and third-tier subsidiaries) #

Article 33 #

Article 34(Restriction on trading with large stockholders) #

Article 35(Ratio of liabilities of non-bank holding company) #

Article 36(Special provisions on limit on extension of credit and restricted Acts of subsidiaries) #

Article 37 #

Article 38 #

Article 39 #

Article 40 #

Article 41 #

Article 41-2 #

Article 41-3 #

Article 41-4 #

Article 41-5 #

Article 42 #

Article 42-2(Special cases concerning standards for large stockholders of subsidiary of financial holding company) #

Article 43 #

Article 43-2(Obligation to own stocks of subsidiaries) #

Article 43-3(Obligation to own stocks of second-tier subsidiaries) #

Article 44(Limits to holding stocks of other companies) #

Article 45(Limit on extension of credit) #

Article 45-2(Limit on extension of credit for major investors of bank holding company) #

Article 45-3(Limit on acquisition of stocks issued by major investors) #

Article 45-4(Prohibition from exercise of undue influence by major investors) #

Article 45-5(Demands to submit data to major investors) #

Article 46 #

Article 47(Entrustment of business affairs between subsidiaries) #

Article 48(Restrictions on conduct by subsidiaries) #

Article 48-2(Provision and management of customer information) #

Article 48-3(Prohibition on taking bribes) #

Article 49(Supervision) #

Article 50(Guidelines for sound management) #